So those are kind of the key drivers of the gross margin. We also expect to see some leverage in the operating margin as a result of increasing revenues allowing us to leverage that cost structure. So if I think about the key components that would be the four points I’d reference.
Operator: The next question comes from Michael Matson with Needham & Company. Michael, please go ahead.
Michael Matson: Yeah, thanks. So I want to ask one on pricing. I think you said you had over 50 basis points and I think that was for the full year 2022. What have you kind of assumed in the guidance for 2023? Is it kind of remaining at that level? Could it even be higher maybe?
Liam Kelly: So, we began the year in 2022, expecting 50 basis points of positive pricing and we exceeded that goal in 2022, Mike. So we came in comfortably above the 50 basis points. We would expect again to be above 50 basis points and to deliver a minimum of 50 basis points of pricing this year. And we have a pathway to that. We have some carryover from the prior year and we have some additional pricing opportunities that — some of which we’ve already executed.
Michael Matson: Okay. Got it. Thanks. And then, I think, Tom did call out some restructuring in his comments on the margin. So is that existing programs, or are you planning anything new there?
Thomas Powell: That is existing programs. We have a number of footprint programs that are still finalizing and will be largely done by 2025. And then we introduced a new program in the fourth quarter of 2022 that will be complete by 2024. So everything I spoke about are known and existing programs that frankly we’re managing to expectations.
Operator: The next question comes from Matthew O’Brien with Piper Sandler. Matthew, please go ahead.
Matthew O’Brien: Good morning. Thanks for taking the question. So, Liam, as I think about UroLift and this new 8% to 9% CAGR through the LRP, I think that’s about $90 million to $100 million of incremental revenue through that time frame by 2025. So if I remember correctly, Japan and China were supposed to be pretty sizable contributors, I think, in the out years, maybe half of that $90 million to $100 million, maybe a little bit more than. So it would imply some fairly modest improvement here domestically. First of all, am I right about that? And then, secondly, how conservative is that? Does it make sense to be doing these DTC, or making this DTC spend, if you don’t think the domestic business can really accelerate over the next several years?
Liam Kelly: So, Matt, your overall math is fairly good, with regard to the growth in UroLift over the three-year horizon. I think that we still are reliant on the US to drive the bulk of the growth, just because the overseas markets aren’t big enough. Clearly, overseas and international, we’re encouraged by what we’re doing. And by the time we get to the end of 2025, it will be a bigger portion of the revenue. And of course, on a smaller base, the percentage growth is going to be much better. We’ve done a really good job in Japan. We’re going to do a really good job in China, Taiwan, India, France, Spain, Italy, Germany, Brazil and so on and so forth, but they’re just not big enough to carry the growth to get us to that CAGR of 8% to 11%.
